We’re already seeing AI power autonomous driving systems, we’re letting virtual assistants such as Siri and Alexa into our lives more and more, and AI is getting ever-better at anticipating changes in the stock market and managing investments.
There are countless other examples of how AI is shifting industry landscapes but what about retail and marketing? What’s “in store” for the customer over the coming years? And what will happen to the employees of these industries?
Are the Retail and Marketing Sectors Ready for AI?
We recently attended this year's eTail Europe conference and the buzz and interest surrounding AI was immense. It’s an exciting topic – many were enthusiastic and even more agreed that the technology will continue to truly transform the course of retail and marketing.
From automating processes, revealing customer insights, and improving customer interactions, to transforming personalisation, content creation, and ad buying, the benefits AI brings are increasingly understood by retailers too.
But are businesses actually ready to embrace this new technology?
Forrester looked into this question with its extensive 2017 survey, asking respondents to assess their digital competencies across three dimensions: organisation, strategy, and technology. The market research firm discovered that 11% of respondents showed true AI marketing readiness across all three areas (labelled as “experts"), 34% excelled at two of the three dimensions (“opportunists”), 28% performed well at just one (“novices”), and 27% struggled across all dimensions ("laggards").
The biggest obstacle for firms who want to capitalise upon AI technologies seems to be the technical skills required, with more than 70% of business decision makers stating their employees lack the expertise to leverage AI marketing technology. Forrester goes on to offer a solution to the problem:
Seek guidance from technology vendors that have the expertise and track record to support your firm’s AI marketing strategy. Early adopters also have the opportunity to work with vendors to influence the evolving simplicity and effectiveness of AI marketing solutions, ultimately maximizing their business value in the long term… Not all firms will have all the required skills in the marketing organization, and given the talent shortage, it's also likely that firms won't be able to rely on external recruitment to fill the gaps.
AI and Personalised Site Search
Machine learning site-search algorithms take us one step closer to Artificial Intelligence. Today, site-search is a key contributing factor to e-commerce success, and machine learning algorithms have been shown to drastically improve customer ratings, click rates, and conversions.
Machine learning lets site-search build new relationships between relevant products, creating an intelligent, self-optimising list of 'related results'. It lets you start to look at "segments of one", since traditional segmentation is transformed into individual personalisation. The result of this approach is that highly relevant, useful, and targeted recommendations are produced.
As we explained in a recent post, 4 Key Takeaways from eTail Europe 2018, the transformations that AI will continue to bring will actually mean marketeers will be able to spend more time on core activities.
Rather than having to spend energy on complicated tasks such as data integration, analytical model development, and algorithmic optimisation, marketeers will be freed up to focus more on strategic work, driving new content, and improving customer experiences.
Targeting and Personalisation are Just Part of the Story
Forrester notes that the majority of AI marketing applications focus on improving existing use cases, such as personalisation and targeting. But while these use cases are important, neither cater for one simple but important truth: in today’s digital world, customer attention spans are becoming shorter.
In fact, one study showed that, at nine seconds, the average goldfish now has a longer attention span than the average human (eight seconds).
Personalisation and targeting don’t address customer requirements in their moments of need. The upshot is that retailers are planning to make use of an array of different AI marketing tools: Forrester’s survey found 40% intend to use intelligent recommendation solutions, 37% machine learning, 29% virtual assistants, and 29% deep learning and neural networks.
All of these tools allow companies to fully tap into vast swathes of data and cut the insight-to-action gap drastically.
AI, machine learning, deep learning, neural networks, etc are all exciting buzzwords that retail and marketing professionals are keen to latch onto. But for good reason. Members of these industries recognise that the enhanced personalisation and understanding of consumer behaviour they bring are not just a fad or trend with a limited shelf life.
AI is humanising retail and marketing, bringing with it all the intuition and savvy that a proficient retail professional can offer in a physical store. It's answering the questions that the two disciplines have been asking about their customers from day one, but in a radically more sophisticated way.
If you'd like to learn more and see how Loop54 have uniquely approached the technology, our complete software spec sheet is a good place to start – download it for free today.